eye on defense_april 2012
TRANSCRIPT
-
7/25/2019 Eye on Defense_April 2012
1/31
Indian defence budget 2012-2013:
an analysis 02
DOFA: a single window mechanism 08
Alenia: C-27J SPARTAN Tier 1s 13
Request for Information (RFIs) 15
Request for Proposal (RFPs) 16
List of industrial licenses (ILs) led
from 01/01/2012 TO 29/02/2012 17
New projects/investments/contracts 18
Joint ventures and alliances 21
Country-level deals and initiati ves 23
Industry buzz 24
Sources 28
April 2012
Eye on defence
Dear readers,
The rst quarter of the New Year has witnessed some signicant
developments in the Indian defence sector.
Recently the 7th Defence Expo was held in Delhi in the last week
of March. There was certainly some reduction in the fanfare and
glamor, which was expected following the MMRCA decision. The
coinciding of the Defexpo with the nancial year closing also had an
impact with most senior level representatives of Indian companies
being present only for selected periods of time.
The Union Budget was also presented in the Parliament on 16 March 2012. Keeping with
the trend the defence budget was increased by double-digit percentage points (17.6%) over
the previous year. With the MMRCA now almost certain to be signed within this scal, the
adequacy of the defence budget is likely to be tested.
Last but not the least, there were a urry of articles in all major news-papers and the
internet about the amendments to the Offset policy. Noticeably these amendments
permitted ToT as offsets and also intro duced the concept of multipliers. However there
has been no ofcial statement or release or document uploaded on the MoD website to this
effect.
In our current issue, we have analyzed the latest defence budget; proposed certain
methods of imple-menting the recent changes to the offset policy (ofcial announcement
awaited) and described the Tier-1s of Alenia Aermacchis C-27J SPARTAN platform,
which is in contention for multiple programs in In-dia.
We hope you enjoy reading this issue of the Eye on Defence. It has been our constant
endeavor to make this publication more relevant to you and would appreciate your
comments and suggestions in this re-gard.
K. Ganesh Raj
Partner and Leader
Aerospace and Defence Practice
-
7/25/2019 Eye on Defense_April 2012
2/31
Indian defence budget201213: an analysis
The Government of India (GoI) in its Union Budget 2012-13 has earmarked INR1,934 billion
(US$42.9 7 billion) for defence, increasing it by 17.6% as compared defence allocation of
INR1,644 billion (US$36.536 billion) in 201112. The defence budget 201213 accounts
for 12.97% of the total government expenditure and 1.9% of GDP. INR795.79 billion
(US$17.68 billion) has been allocated for capital expenditure and INR1,138.28 billion
(US$25.29 billion) has been allocated for revenue expenditure. The attached diagram
shows the defence budget allocations (including capital and revenue) in the last three years:
Share of services
In 201213, the Army with an approximate budget of INR969.43 billion (US$21.54
billion) accounts for the highest share of around 50%; at a distance followed by the Air
Force with INR475.59 billion (US$10.56 billion), which accounts for 25% of the defence
budget and the Navy, with an approximate budget of INR217.58 billion (US$4.83 billion),
which accounts for 19% of the total defence budget. Defence Research and Development
Organization (DRDO) with INR106.35 billion (US$2.36 billion) allocation, and ordnance
factories (OFs) with INR4 billion (US$0.088 billion) allocation together account for 6% of the
total budget. The pie diagram depicted below gives us the percentage shared by defence
services in Defence Budget 201213:
Defence budget = Capital + Revenue
13.33 15.37 17.68
19.41 21.38
25.29
32.7436.75
42.97
0
5
10
15
20
25
30
35
40
45
50
2010 - 2011 2011 - 2012 2012 - 2013
AmountinUSDbilllion
Capital Revenue Total defence budget
Eye on defence | 2
-
7/25/2019 Eye on Defense_April 2012
3/31
Capital expenditure
The capital expenditure, which is meant for acquiring new weapon systems and platforms
has been scaled up to INR795.79 billion (US$17.68 billion), a 15.7% hike from last
years capital allocation of INR691.99 billion (US$15 billion). However, the actual capital
expenditure (revised estimates) was INR661.43 billion in 201112, which will mean that
actual hike is around 20%. In other words, this year the MoD surrendered INR30.56 billion
(4.41%) as unspent from its capital head. But, the overall share of capital expenditure as
a part of total defence expenditure has actually fallen to 41.11% from 42.09% from the
previous nancial year.
Share of defence services in defence budget 201213
Indian Army
50%
Indian Air Force
24%
Indian Navy
19%
OF+DRDO6%
Miscellaneous
1%
Share of capital: Revenue 2011-12
Capital expenditure
42%
Revenue expenditure
58%
Share of capital: Revenue 2012-13
Capital expenditure
41%
Revenue expenditure
58%
Eye on defence | 3
-
7/25/2019 Eye on Defense_April 2012
4/31
Currently, all the three segments of the Armed Forces, the Army, the Navy and the AirForce, are on a transformation drive to acquire platforms and weapons with cutting-edge
technology, which are expected to be nalized in 201213. The graph given below shows
the sub allocations and percentage share, out of the total capital outlay allocated to the
different services:
The capital acquisitions allocations has
to cater for committed liabilities for the
year from the orders signed previous
years and are likely to be incurred on
account of the fresh schemes, during the
nancial year. The committed liabilities
as on date are around 65%70% of the
total capital outlay, thus leaving around30%35% only for new schemes. Under
the capital head, of the INR795.79 billion
(US$17.68 billion) nearly 70% or around
INR550 billion (US$12.22 billion) will
be for committed liabilities, thus leaving
around INR250 billion (US$5.55 billion)
for fresh purchases. With the impending
defence acquisitions, the ability of
the GoI to complete new purchases is
comparatively more limited than before.
Among the deals in the nal stages for
which the capital expenditure is likely to be spent upon include 126 ghter jets for US$20billion, six mid-air refuelling aircraft for US$2 billion, 75 trainer aircraft for US$1 billion,
US$647 for 145 Ultra Light Howitzers (ULH), 197 utility helicopters for US$750 million, 22
attack choppers valued at US$600 million and GE F414-INS6 engines for indigenous Light
Combat Aircraft (LCA) Tejas and Harpoon anti-ship missiles estimated at US$170 million.
Besides, a US$1.18 billion deal to procure 490 MICA missiles for Mirage 2000H multi role
ghters, 42 additional upgraded Sukhoi-30 MKI aircraft, around 40 warship of the Navy,
including refurbishment of an aircraft carrier and nuclear-powered submarine, are under
construction at home and abroad.
Revenue expenditure
In the budget for 201213, the
revenue expenditure, which caters tothe everyday operating expenditure
of the three services has been raised
to INR1,138.28 billion (US$25.29
billion) as compared with last years
revenue allocation of INR1,035 billion
(US$23.62 billion).
IAF
38%
Capital expenditure 201213: Service wise
IA: Indian Army; IN: Indian Navy; IAF: Indian Air Force;
DRDO: Defence Research & Development Organization;
OFB: Ordnance Factory Board
IA24%
IN12%
DRDO
6%
OFB
1%
Naval Fleet
17%
Miscellaneous2%
Revenue expenditure 201213: Service wise
IA: Indian Army; IN: Indian Navy; IAF: Indian Air Force;
DRDO: Defence Research & Development Organization;
OFB: Ordnance Factory Board
IAF16%
IA68%
IN11%
DRDO5%
Eye on defence | 4
-
7/25/2019 Eye on Defense_April 2012
5/31
Defence budget 201213: key statisticsThe defence budget for 201213 has been increased by 17.6% over the previous years
allocation. The increase in the defence budget has the following impact on almost all
key components (see Table). On the positive side, however, the ratio between revenue
expenditure and capital expenditure has improved toward the former.
Comparison defence budgets, 2010-11, 2011-2012 and 2012-13
201011 201112 201213
Defence budget ($ in billions) $32.74 $36.75 $42.97
Growth of defence budget (%) over
Previous year
3.98% 11.59% 17.63%
Revenue expenditure ($ in billions) $19.03 $23.62 $25.20
Share of revenue expenditure in
defence budget (%)
60% 58% 59%
Capital expenditure ($ in billions) $11.95 $13 $17.29
Share of capital expenditure in defence
Budget (%)
40% 42% 41%
G rowt h of ca pi ta l ex pen dit ure (% ) 2 5. 40 % 1 5. 33 % 1 5. 70 %
Revenue vs. capital expenditure
The percentage share of capital allocation in the defence budget as compared to revenue
allocation has seen a decline this time. This growth has, however, been driven primarily
because of the increase in pay and allowance of the armed forces, which has increased by
27% to INR631.82 billion (US$14.04 billion), accounting for around 46% growth of the total
defence budget.
Budget utilization
The defence budget for 201112 has been revised upward by INR65.21 billion (US$1.44
billion) to INR1,709.36 billion. However, unlike the revised estimate for 201011, in which
both the revenue expenditure and capital expenditure were higher than their respective
budget estimates, the revised esti-mate for 201112 shows an increase in revenue
expenditure (by INR9,576.32 million or 10.06%) and decline in capital expenditure byINR3,056 million (or 4.41%). Thus, this year the MoD has returned about INR30.56 billion
(US$0.67 billion) but fresh major purchases in 2012 are expected to be executed in 2013,
which gives an impression that the next revised capital budget may even exceed the
earmarked INR800 billion (US$17.77 billion) in 201213. Returning of unspent capital
funds shows a lack of planning, as is evident from the past.
Utilization of allotted capital budget (amount in USD billion)
2007-2008 2008-2009 2009-2010 2010-2011 2011-2012
$=45 INR BE RE BE RE BE RE BE RE BE RE
CE 9.32 8.38 10.67 9.11 12.18 10.63 13.33 13.52 15.38 14.7BE-RE 0.94 1.56 1.56 -0.19 0.67
CE-Capital Expenditure BE-Budget Estimate RE-Revised Estimate
Eye on defence | 5
-
7/25/2019 Eye on Defense_April 2012
6/31
It is to be noted that the procurement process has thus picked up and the allocations have
been fully committed as against surrender earlier as shown in the table and gure above.
The revised estimate for 201112 also shows only marginal surrender of around 4%.
Impact analysis
India has an annual capital expenditure of around US$15 billion, and is the worlds biggest
importer of defence equipment, accounting for 10% of global arms imports between 2007
and 2011. While Indias defence imports are ofcially put at 70%, the actual gure isconsiderably high and is likely to be around 85%, if imports made quietly by defence public
sector corporations (DPSUs) are included.
Although Indias defence spending has more than doubled in the last ve years from
INR960 billion to INR1,934.07 billion but the military establishment still feels that the
nancial outlay should be further increased to beef up capabilities. In real terms, this
increase amounts to INR289.92 billion (US$6.44 bil-lion) in the total outlay for defence
for 201213 compared to the defence budget for the previous year (201112). However,
if we take the revised estimates of the budget 201112 then this budgeted estimate has
seen an increase of 13.1 % from the previous years revised estimate of INR1,709.36 billion
(US$37.98 billion) in 201112. The GoIs ne balancing of resources, rising ination and
the exchange rate variations (ERV) leading to sharp devaluation of the Indian rupee against
the US dollar, have caused the defence services modernization budget to be effectively
reduced for the rst time in decades.
The share of this years defence budget, which accounts for only 12.97% (approx.) of
the total Central Governments expenditure for the year 201213 has seen a decline
as compared to last year. Also, the money allocated for defence is below 2% of the
GDP where as a healthy defence budget is expected to be between 2.5% and 3% of the
countrys GDP. This year, the defence budget constitutes 1.90% of the GDP (estimated to
be INR101598.84 billion (US$2257.75 billion). It was 1.83% of the GDP in 201112 and
was 2.2% in 201011. What is signicant is that it is the second successive year when the
defence budget was less than 2% of the GDP. The gure given below shows the decline in
GDP in defence budget.
Capital budget: Spending
9.316 10.67 12.18 13.33 15.38
-10%
-15 %
- 13%
1%-4.5%
0
2
4
6
8
10
12
14
16
18
2007 -2008 2008 -2009 2009 -2010 2010 -2011 2011 -2012
AmountinUSDbillion
Budget estimate Budget unspent Budget over-spent
Eye on defence | 6
-
7/25/2019 Eye on Defense_April 2012
7/31
The armed forces, and even the Parliament, have been asking for an allocation of 3% of the
nations GDP to defence for a long time but the projected GDP of this year falls short. It is
to be seen that if our economy grows at around 8% per annum, it will not be difcult for the
GoI to allocate around 3% of GDP for National defence.
A closer look at the growth of the capital budget for 201213 would reveal that the
focus is entirely driven by the Navy, which has got a 72% hike (to INR241.51 billion) in its
modernization budget. The Air Forces modernization budget has increased marginally
(by 0.5%) to INR285.03 billion, while the Armys has declined by 3% to INR138.04 billion.
Trends in service-wise allocations, especially in capital budgets, suggest that Indias current
military modernization is weighted heavily in favor of the Air Force and the Navy, which
together account for INR540 billion approximately (US$12 billion). This conforms to alarger defence landscape where the aerospace as well as maritime domains are likely
to play a critical role in future. However, what is of concern is the increasing revenue
allocation for the Army at the cost of capital acquisitions. The Armys modernization has
already been hit by cancellation of major purchases, especially in artillery, armored and
soldier modernization and combat helicopter equipment. The obsolete air defence systems,
shortage of tank ammunition and deciencies in night-ghting capabilities has adversely
affected the Armys capabilities. Unless the MoD catches up with at least replenishment
requirements, the Army is likely to lag behind in overall modernization, which in turn will
cause more problems.
Notwithstanding above, the strategic shift in the threat perception from conventional war
to asymmetrical challenges have to be kept in mind during resource allocation besides
maintaining a ne balance be-tween defence and development. The eventual objective of
war is to break down the adversarys economic prowess by neutralizing strategic assets.
Our endeavor should be to focus on those areas as well. The defence forces will do well in
case they rationalize the tooth-to-tail ratio. Time has come to discard the baggage, which
are not required in the present operational environment.
Note: The conversation rate for $: INR has been kept at 1:45 for sake of uniformity and standardization with
the previous fgures.
Share of defence budget in GDP
0
0.5
1
1.5
2
2.5
Inp
ercentage
2008-2009 2009-2010 2010-2011 2011-2012 2012-2013
Eye on defence | 7
-
7/25/2019 Eye on Defense_April 2012
8/31
DOFA: a single windowmechanismBackground
India is probably the only country in the world that has an institutionalized mechanism for
facilitation of Offsets. The MoD clearly lists out the nuances of the policy, its procedures;
etc. Yes there is scope for improvement, but the transparency shown by the MoD cannot
be overlooked.
The rst DPP that included Offsets implementation was promulgated in 2005 but the rsteffective DPP in this regard is always regarded as DPP 2006, wherein detailed guidelines
for implementation of offsets discharge was incorporated as part of DPP 2006. At that
time it was envisioned, most appropriately, that there is a need for a government agency
that is likely to act as a facilitator for foreign OEMs and Indian industry alike. Here was a
government that included consultancy per se as one of the functions to take this great
initiative forwards. The thinking within the government then was to create a vibrant
structure, yet provide the OEMs with all possible assistance to ensure the success of
implementation in Offsets. If one observed the functions and scope of work assigned
to the DOFA then, it is evident that this single organization was intended to work hard,
collect and disseminate information, provide Advisory services to the industry as well
as to the government arms in this business, provide for an e-solution by creating and
sustaining a dynamic web site, be the front end for facilitation and yet remain in the
background to aid in the decision-making process of the acquisition under consideration.
Eye on defence | 8
-
7/25/2019 Eye on Defense_April 2012
9/31
How it all startedSoon after the promulgation of the DPP 2006, DOFA was founded and was established
as part of the DDP. A small organization was put in place headed by the Joint Secretary
(Exports). Soon after, a web-site was also launched, which included the extract of the DPP,
the procedure for implementation of offset guidelines, list of companies that required an
industrial licence and a few interactive features for queries. DOFA was a single window
advisory for the Indian defence industry and the various associations such as CII, FICCI,
ASSOCHAM and foreign OEMs.
DOFA, in its envisioned form (of having members from the industry associations, and other
stake holders as a multi-disciplinary organization), existed for not more than three months
or so when all the members as indicated in the policy were invited for DOFA meetings. Most
probably two such meetings were held after which it felt that such an extended body wasnot was really required. DOFA really meant the Chairperson, who headed the organization
and the PO (CAP) under the Director P&C, who was assigned the additional responsibility of
Offsets as well. This lean organization was effective in the formative years and provided the
single point advice to the Services (TOEC), the MoD(CNC) and the industry.
The effectiveness came about from the singular focus that DOFA maintained till then, To
be a credible Advisory and Facilitate in implementation, unmindful of authority. The name
DOFA is self-explanatory, it is a facilitation agency, and strives to provide service, provide
information and advice to all the stakeholders.
Lost focus
The years 2006, 2007 and early part of 2008 witnessed fructication of some major dealssuch as the Naval Fleet Tanker, the Maritime Reconnaissance and Surveillance aircrafts,
upgrades to the Mig 29 and procurement of Helicopters among others. These were about
eight or nine in number and accounted for more than a couple of billion dollars in offsets
alone. Despite such major programs having been nalized and many more under process,
DOFA was never strengthened to effectively take on the increased work-load. Revisions to
DPP 2006 were at the behest of some very sound feedback from the environment, which
included a procedure for Banking of Offsets credits and removal of the compulsory licensing
condition to establish the eligibility of the Indian Offset partner. At this juncture, instead of
strengthening the DOFA, it was felt more prudent to introduce yet another organization in
the DDP (someone called Director S1, hitherto looking after supplies wing under the Joint
Secretary (Supplies), in the DDP) to be made responsible for banking of offsets.
Due to this new structure, several banking proposals that are in the queue, only two havebeen approved even after four years of introduction. The crux of this matter can possible
be traced to the diluted responsibilities in the new structure and as a result, one of the
most important tools to be introduced in the offset policy is yet to truly play its role in offset
discharge.
Eye on defence | 9
-
7/25/2019 Eye on Defense_April 2012
10/31
What is needed?
A sharp focus is expected of DOFA to enable the organization to discharge its functions.
Any policy, however well it is intentioned, and however well it is drafted, can fail, if the
original goals are lost down the road.
A single-window approach, for the industry to seek guidance and the necessary
support in their endeavors to be able to efciently exploit this opportunity provided by
the offset policy
Integrate the strengths of the government and incorporate a holistic approach
Strategize the concepts in implementation before promulgating yet another policy and
structures
Implementation strategy
One of the questions that emerge is, should DOFA remain a facilitation agency or does it
have some merit in upgrading itself onto an authority of sorts?
Considering the enormous amount of money involved in the procurement process and
subsequently in offsets, many analysts have put the gure of offsets at US$5 billion in
the next three years, the numbers involved are of the highest magnitude, wresting all the
control of Offsets in a single hand could be potentially fraught with danger. All this money
is through industrial participation guided by the avenues for discharge as enunciated by the
DPP, in the chapter, Procedure for implementing off-sets provisions.
Considering the avenues for discharge and the subsequent process for approvals, it can be
seen that there is no single agency that is completely responsible for approvals. This has
advantages as well as disadvantages. The pros are that, distributed responsibility does not
concentrate power in one hand and divergent views are expected to be freely aired without
being afraid of consequences. The greatest disadvantage this has is that there is no time-
bound solution. The process can be indenitely delayed and the blame can be passed from
one to another.
Eye on defence | 10
-
7/25/2019 Eye on Defense_April 2012
11/31
A single-window mechanism is expected to resolve most of the issues and will expedite the
decision-making process. The industry, both domestic and foreign, will not have to keep
running from one ofce to another, in an effort to resolve their queries and problems.
DOFA needs to be focused on facilitation and be dedicated to this cause. This is an
important cause, though without any powers assigned to it. The entire industry, research
analysts and world forums seek to attribute many reasons to why implementation of
offsets in India will not succeed, both from an angle of poor implementation by the MoDas well as the lack of capability within the Indian industry. While the capability has indeed
come a long way and will only enhance in the coming years, both through organic and
inorganic methods, focus on effective
implementation is an immediate need. The
MoD must decidedly uphold the original
cause for facilitation and encourage the
industry to exploit this important forum.
The clarications provided by DOFA
must, in most cases, be binding on the
government while processing the cases at
a later date. This will encourage OEMs to
seek necessary advance clarication prior
to structuring their proposals.
This means, the new single window
organization, which the government
is in the process of establishing, must
incorporate a sound facilitation arm
and retain a sound Advisory inside the
government, both for internal purposes
to educate various stake holders. This
facilitation arm can create and sustain
an institutional memory and refresh
the annals of MoD and the industry in a
periodic manner. This facilitation arm canalso act as the knowledge partner to the
single window offset authority. The MoD
can do well to outsource this task to the
industry on a PPP model.
In order to be an apostle of knowledge,
the facilitation arm must have intimate interaction with the industry, both domestic and
foreign. There is also a requirement of an in-depth understanding of technology as it relates
to defence preparedness of the country. Toward this end, the facilitation arm must also
incorporate experts in the eld of education, technologists and have access to knowledge
that resides in the various research institutions in the country.
Eye on defence | 11
-
7/25/2019 Eye on Defense_April 2012
12/31
The new and vibrant Offset Authority that is in the process of being formed needs to be asingle-window agency that incorporates a facilitation arm, which is also a knowledge arm,
and a separate execution arm. The Execution Arm must necessarily synergize the strengths
available in the government to form a formidable authority.
So what are the strengths available within the MoD?
DRDO is the Technology Arm of the MoD and has inherent strengths to provide for back-
bone resilience. Intimate association with the DRDO is an inescapable requirement. A
detailed knowledge of the technologies being harnessed across various laboratories, the
requirements of the Armed Forces, technologies in vogue across the Armed Forces of the
world, need to be studied and gaps identied. The new Offset Authority may not do the
entire processing, yet it needs to have a good hold on the subject for effective exploitation.
The Armed Forces do incorporate and use new technologies and have a fair idea of what
they need in combat, they must be integrated in a sound manner in this process. Thus,
Services, The Integrated Defence Staff, DRDO should be integrated into the decision-making
process.
The new Offset Authority must integrate all activities of facilitation, banking, processing and
evaluations, approvals, monitoring (for banking and post-contract monitoring), and cover
all the activities associated with offsets. This will ensure accountability and effectiveness in
implementation. The integration with the acquisition process must be full and total, leaving
no room for any delays in the acquisitions due to the lethargy of the Offset Authority.
It is time for MoD to strategize the concepts for implementation prior to promulgating
yet another policy or organization. The drawbacks of the previous organization must be
studied and analyzed threadbare and then effective counter measures must be taken andimplemented in the new structures. This will augur well both for the MoD and the industry.
Conclusion
The new offset authority being conceived by the MoD must be robust, well
staffed both in terms of quality and quantity and incorporate the best practices in
governance. From the highest to the lowest level, the staff must be dedicated. May be
at levels higher than this, multi-tasking could be permitted. DRDO must necessarily
play a dominant role in acquiring technology and be able to ll in gaps so identied as
also aggressively nd the route to production.
Eye on defence | 12
-
7/25/2019 Eye on Defense_April 2012
13/31
Alenia: C-27J SPARTANTier 1s
The C-27J is a medium category transport aircraft and shares many of its systems (Rolls
Royce engines) with the C-130J which India currently posses. The C-27J is currently
looking at participating in multiple tenders that have been oated by the Central
paramilitary and armed forces. The aircraft is capable of taking off from unprepared strips
less than 500 meters long with a maximum takeoff weight of 30,500 kg. The aircraft is
designed to operate in remote areas like those in Jammu and Kashmir and the North-East
from gravel or sand as besides the twin-engines, it has an auxiliary power unit (APU) that
provides electricity and maintains pressure without the need to keep the engines running
when the aircraft is on ground.
At present, besides the US, the C-27 J has been ordered by the air forces of Italy, Greece,
Bulgaria, Lithuania, Romania, Morocco. Slovakia has also selected the aircraft.
Eye on defence | 13
-
7/25/2019 Eye on Defense_April 2012
14/31
No.
Des
cription
3
Aile
rons(L&R)
4
Spo
ilers(L&R)
5
OutboardFlaps(L&R)
6
Inbo
ardFlaps(L&R)
14
Nos
eLandingGearDoors(L&R)
16
Rad
ome
18
MainLandingGearFairings(L&R)
22
Cen
treWingAirfoilUndersideDoor
23
OuterWingAirfoilUndersideDoor
24
Win
gtoFuseFairing
25
ForwardFuselage
26
Cen
treFuselage
27
Fwd
/RearFuselage
28
Aft/
RearFuselage
30
Pipes
31
Wires
No.
Description
1
Centre
Wing
2
OuterW
ing(L&R)
7
HorizontalStabilizer(L&R)
8
Elevato
rs(L&R)
9
Vertica
lStabilizer
10
Rudder
11
UprRearemergencyHatch
12
Paratro
opfoors(L&R)
13
UprFw
demergencyhatch
15
Sidemergencydoor
17
Fwdcrewdoor
19
Loadingramp
20
Loadingdoor
21
Uprctr
emergencyhatch
29
Nacelle
(L&R)
32
Propellers
Alenia(InHousefabricationand
assemb
le)
Subcon
tracted
Eye on defence | 14
-
7/25/2019 Eye on Defense_April 2012
15/31
Request for Information (RFIs)
January 2012 15 April 2012
Date of issue RFI details Response date Issued by Service
6 Jan 2012 RFI and Interaction with
Manufacturers of Operating
Theatre Shelter Inatable
11 Jan 2012 MGO/EM/GS&C
Room No 206
Army
6 Jan 2012 General Purpose Machine Gun
for PARA (SF)
20 Jan 2012 Director General of Infantry
Infantry - 7
Army
6 Jan 2012 Spares, Repair and Over-haul of
Missile Test Station
23 Jan 2012 Directorate General Of EME
(Electronics)
Master General of Ordnance
Branch
Army
22 Feb 2012 Unmanned Aerial vehicle (UAV)
mission simulator for UAV crew
22 Mar 2012 Directorate General Of Artil lery 5 Army
21 Feb 2012 Full Body Truck Scanners 13 Mar 2012 MI Dte Army
22 Feb 2012 Night Sight for Carbine 10 Mar 2012 Inf Dte Army
23 Feb 2012 Optical Theodolite Instrument 15 Mar 2012 Directorate General of Artillery 5 Army
23 Feb 2012 Electro Optical Instrument 30 Mar 2012 Directorate General of Artillery 5 A rmy
15 Mar 2012 Specialist Vehicle 15 April 2012 Inf Dte Army
19 Mar 2012 New power pack with minimum360 horse power engine
including running gear and
suspension for Infantry Combat
Vehicle (ICV) BMP-2/2K
30 April 2012 DGMF Army
13 Jan 2012 Technical And Commercial
Information For A WIMAX
System
6 Feb 2012 Joint Director of Naval Signals
(Networking)
Directorate of Naval Signals
Indian Navy
3 April 2012 Diver Navigation System 20 April 2012 Directorate of Spe-cial Ops &
Diving
Indian Navy
1 April 2012 Surveillance Radar 23 April 2012 HQ CAC
Bamrauli
Allahabad
Indian Air Force
20 Mar 2012 Deep Search Metal Mine
Detector(DSMD)
2 April 2012 CRPF CRPF
1 April 2012 Surveillance Radar 23 April 2012 HQ CAC
Bamrauli
Allahabad
Indian Air Force
9 April 2012 Comjam And Sigint Aircraft 24 May 2012 PD ASR (Room No 460)
Air HQ (Vayu Bhawan),
Ra Marg
Indian Air Force
11 Apr 30 mm or more AD Gun 30 Apr 2012 DGWE(WE-9)
General staff branch
Room no 208g, south block
Integrated hq mod (army)
Dhq po, New Delhi-110011
Indian Air Force
Eye on defence | 15
-
7/25/2019 Eye on Defense_April 2012
16/31
Request for Proposal (RFPs)
Date of issue RFP details/equipment Response date Issued by Remarks
19 Jan 2012 GPS for Aviation Navigation 19 March 2012 Army Commander Special
Financial Power Cell Northern
Command
For Army
7 Feb 2012 Counter Terrorism Operations
Planning Tool and WargamingSystem
14 April 2012 WARDEC For Army
7 Mar 2012 Light Weight BP Jacket 12 Mar 2012 INS Abhimanyu For Navy, Qty: 48
11 Jan 2012 Portable air supply &
communication system
30 Jan 2012 Commander
Operations Ofcer
For Navy
24 Feb 2012 Expression of Interest for
Technical Consultancy Services
for Phase IIA of Project Seabird,
New Delhi
21 Mar 2012 Director General
Project Seabird
For Navy
23 Jan 2012 Hand Held LED Torches with
Accessories
13 Feb 2012 SO PROVOST
HQ WAC IAF
For Indian Air Force
21 Feb 2012 Repair overhaul of Russian origi n
aggregates of Illushin aircraft
of IAF
3 Apr 2012 D Eng TI
Air HQ (VB)
For Indian Air force
27 Jan 2012 Supply And Installation Of CCTV
Surveillance System
27 Feb 2012 Wing Commander
Units Logistics Section
Training Command
For Indian Air Force
Qty: 12 Nos.
30 Jan 2012 FUZE T AND P DA NO 213 P-MK-
5(M-2)
28 Feb 2012 Ordnance Factory Dehuroad,
Pune
For OFB
Qty: 10190
15 Feb 2012 Smokeless Pyroxylene
Propellant Powder for 14.5 MM
Ammn.
20 Mar 2012 Ordnance Factory Khamaria
JabalPur
For OFB
15 Feb 2012 Smokeless Pyroxylene
Propellant Powder for 14.5 MM
Ammn.
20 Mar 2012 Ordnance Factory
Khamaria JabalPur
For OFB
3 Mar 2012 Power Unit Part No.1155261,
complete as per BOM and Drg.
Attached as Annexure-I for 155
mm FH Gun
10 April 2012 Joint General Man-ager
Gun Carraige Fac-tory
For OFB
Qty: 06
14 Feb 2012 Image I ntensier Tube 18mm
AVG Glass I/P
20 Mar 2012 Ordnance factory
Dehradun
For OFB
Qty: 352 units
Jan 2012 Explosive Detection Kit 15 Feb 2012 Deputy I nspector
General of Police,
Central Reserve
Police Force
For CRPF
Qty: 10 Nos.
30 Jan 2012 Hand Held Thermal Imagers and
Accessories
14 Mar 2012 Directorate-General, CRPF For CRFP
Qty: 100
23 Feb 2012 Global Positioning System 17 Mar 2012 CRPF CRPF, Qty: 77
4 April 2012 Ammunition for Shooting
competition
18 May 2012 Directorate General, Border
Security Force
For BSF , Qty: 882400 Rounds
4 April 2012 Doppler radar system for
velocity measurement of sub-sonic and super-sonic projectiles
29 May 2012 Indian Ordnance Factories
AMMUNITION FACTORY,KHADKI
For OFB
2 April 2012 Rubberized inatable Boats with
25 HP OBM
15 May 2012 Directorate General, Border
Security Force
For BSF, Qty 75 Nos.
January 2012 15 April 2012
Eye on defence | 16
-
7/25/2019 Eye on Defense_April 2012
17/31
List of industrial licenses (ILs) led from01/01/2012 TO 29/02/2012Application no. and date Name of the applicant Item of manufacture
1: 5/1/2012 Mistral Solution Pvt. Ltd. Defence electronics hardware boards
2 : 6 /1 /2 01 2 Ta ta A dva nce d M at er ia ls Ltd . M an ufa ct ure of p ar ts a nd a cce sso ri es N .E .C . fo r a irc ra ft o r s pa ce
craft
3: 31/01/2012 Vinyas Innovative Technologies Pvt. Ltd. Electronic printed card board, assemblies/electronic
subassemblies/military wire ha rnesses for defence andaerospace application
4 : 3 1/ 01 /2 01 2 E lc om e m ar in e s er vi ce s P vt . L td . Sy st em i nt eg ra ti on f or e le ct ro ni cs i nc lu di ng d es ig n a nd
production of customized hardware and software (GUI / API
based, as well as embedded) (NIA 620)
5 : 7 /2 /2 01 2 Ta ra A ero sp ace Sy st em s Ltd . C om po ne nt s k it s / a cce sso ri es fo r a irc ra ft ( ro to r c ra ft s a nd xe d
wing aircraft )
6 : 1 3/ 02 /2 01 2 N ava ni dh i E le ct ro ni cs ( P) L td . A nt en na s, H F/ VH F/ UH F/ RF p ow er a mp li e rs , e le ct ro M ec ha ni ca l
masts, security jammers, mo-bile Jammers & cell phone
jammers, microwave systems and components for EW equipment,
V/UHF, l-band Digitally tuneab le lters, active night vision and fog
vision equipment
7 : 2 2/ 02 /2 01 2 P ip ava v D efe nc e a nd O ff sh ore
Engineering Co. Ltd.
Manufacture of tanks (armored ghting vehicles) gun Turrets (land
and sea), artillery systems (including upgrades and overhaul)
8 : 2 2 /0 2 /2 0 12 U n iq u e I n st r um e nt s & M f rs -P v t. L td . M a nu fa c tu re o f a i rc ra f t a n d e n gi n e p ar t s, a c- ce ss or i es a nd s ub -
assemblies
9 : 2 3/ 02 /2 01 2 S ri L ak sh mi E xp lo C he mi ca ls S ol de ri ng o f f us e h ea d u nt o i ns ul at ed t wi n w ir es o f p re cu t l en gt hs ,
sleeving and tagging
1 0 : 2 9 /0 2 /2 0 12 A s ho k L ey l an d D e fe n ce S ys te m s L td . D es i gn d ev el o pm e nt , m an u fa ct u re a ss em b ly, o ve r ha u l, r ep ai r
and upgrade of defence equipment to include armored fghting
vehicles, other armored combat vehicles, unmanned ground/
aerial vehicles, armor protected vehicles, specialist vehicles etc.
Eye on defence | 17
-
7/25/2019 Eye on Defense_April 2012
18/31
New projects/investments/contracts
Name of entity Project details Value
Bharat Dynamics
Ltd. (BDL)
BDL plans to set up a surface-to-air missile unit in Hyderabad with a capacity to
produce an estimated 6,000 sophisticated medium-range missiles.
The plant spread over 630 acres is expected to be operational by 2016 and create
employment for 700 people directly and 2,000 indirectly.
INR300 billion
Indian Air Force
GOI has signed contracts with M/s Thales, France and M/s Dassault Aviation, France,as well as M/s Hindustan Aero-nautics Limited (HAL), India to upgrade the Mirage
2000 aircraft of the Indian Air Force (IAF), scheduled to be completed by 2021.
Another contract has been signed with M/s MBDA, France, for procurement of air-
to-air missiles for the Mirage 2000 aircraft. The delivery of missiles is scheduled
between 2015 and 2019.
Contract with M/sThales and M/s Dassault
Aviation: INR101.66
billion
Contract with M/s HAL:
INR20.2 billion
Contract for pro-
curement of the missiles:
INR66.25 billion
Pawan Hans
Indian government-owned Pawan Hans has submitted a proposal to four central
ministries seeking the purchase of 249 helicopters and 10 sea planes and the
construction of 180 helipads across India.
The aircraft and helipads will improve aerial surveillance, law-and-order monitoringand Indias response to medical emergencies and natural disasters. This is also likely
to make at least 30% of Indias districts and many remote areas more accessible.
INR100.30 billion
Defence public
sector units
Four defence public sector units are setting up nine manufacturing units in Andhra
Pradesh that is expected to create 10,000 jobs in the state.
This includes Bharat Dynamics Ltd. (three units), Bharat Electronics Ltd. (3 units),
Electronics Corporation of India Ltd. (2 units) and Mishra Dhatu Nigam Ltd.
(MIDHANI) (one unit).
INR70 billion
Government of
India
The Russian Akula-II class submarine K-152 Nerpa was commissioned into
the Indian Navy as INS Chakra on a 10-year lease agreement. INS Chakra,
commissioned at the Primorye region in far southeastern Russia will soon be sent to
India.
With this, India has become the worlds sixth country after the US, Russia, France,
the UK and China to operate nuclear powered submarines.
INR46.67 billion
Government of
India
The GoI is purchasing 75 Pilatus trainer aircraft from Switzerland. Deliveries of the
aircraft are expected to begin in 2013.
The Pilatus aircraft is likely to replace the earlier HPT-32 trainers that were
grounded after a fatal accident in 2009.
INR18.50 billion
Poland
Bumar, Polish-based supplier of armaments and defence signed an export contract
for armored units to the Indian army.
It also signed an agreement with BEML stipulating co-operation on projects,
including sales to third-party markets.
INR15.56 billion
Eye on defence | 18
-
7/25/2019 Eye on Defense_April 2012
19/31
Name of entity Project details Value
Pratt & Whitney Pratt & Whitney, unit of United Technologies, is exploring to set up an MRO
(maintenance, repair and overhaul) unit, an aircraft engine components facility and
a training center in India.
The company is holding talks to set-up a JV with Tatas and L&T and the proposed
unit is expected at Bangalore or Hyderabad.
INR7.78 billion
Bharat Earth
Movers Limited
(BEML)
BEML initiated the process of setting up an Aerospace manufacturing division near
Bangalore airport. The facility will be spread over 3,00,000 sq ft and is expected to
be ready by September 2012.
This Aerospace Facility will be capable of manufacturing aerospace components and
parts, assembling of aircraft and helicopter up to 21 meters height.
INR4.45 billion
Tata Motors
Tata Motors Ltd. will invest to build a factory subject to supply order of 2,000
infantry combat vehicles to the Indian Army.
The company submitted a bid two years ago to supply the infantry vehicles.
INR3 billion
Hind High
Vacuum
Hind High Vacuum (HHV), a vacuum technology major that supplies equipment for
satellite and aircraft projects to ISRO, Hindustan Aeronautics, DRDO etc. has stated
plans to set-up a third plant near Bangalore focusing on the defence and aerospacebusiness.
HHV is open to a foreign equity stake or an investor in its existing plant.
The company wants to increase its presence globally and aims to more than double
its turnover to INR5 billion by 2014 (from nearly INR2 billion this scal year).
INR2-3 billion
Indian Central
Board of Excise
and Customs
Smiths Detection, part of the UK-based global technology business Smiths Group,
has won a contract to supply the Indian customs authorities with high-energy, X-ray
screening systems.
Smiths Detection will work in partnership with Bharat Electronics Limited and will
deliver the systems to the ports of Chennai, Tuticorin, Kandla and Mumbai over the
next two to three years.
INR1.04 billion
Kalyani Group Kalyani Group, a diversied Indian conglomerate will invest INR1 billion to develop a
towed artillery gun to meet the future needs of the countrys armed forces.
It is developing the gun on its own with a technology partner and has hired 60
experts for its development.
INR1 billion
Ministry of
Defence
The defence ministry is purchasing six Mi-17 V-5 helicop-ters from Russia to be used
by the Union Home Ministry to assist the forces in internal security duties.
These helicopters are being built by Russian Helicopters Kazan Helicopter Factory
(KVZ) subsidiary.
NA
Hindustan
Aeronautics Ltd.
(HAL)
A new unit of HAL at Seethangoli, Kerala was inaugurated in February. The unit
will prepare indigenous designs and assemble components purchased from abroad
for the armed forces aircraft and choppers and state-of-the-art communicationequipment, radio altimeter used in radar devices and navigation radar computers.
NA
Eye on defence | 19
-
7/25/2019 Eye on Defense_April 2012
20/31
Name of entity Project details Value
Bharat
Electronics (BEL)
The Coast Guard has selected Bharat Electronics (BEL) to provide turnkey
surveillance solution.
BEL has also given a contract to Obzerv Technologies to supply it with 46 ARGC-
2400 cameras.
This program is the rst phase of the Indian coastal surveillance project designed tocover the entire coast.
NA
Russian
airplane-building
corporation
(RAC)-MiG
Russian airplane-building corporation (RAC)-MiG completed supply of ship borne
ghters MiG-29K/KUB in-tended for aircraft-carrier Vikramaditya to the navy of
India in late 2011.
The contract on supply of 16 combat airplanes in the single-seat version K (ship
borne) and double-seat version KUB (ship borne combat training) was signed in
2004.
The company has already started production of the next batch of 29 such ghters in
accordance with the additional contract signed with India in March 2010.
NA
Indian Rotorcraft
Indian Rotorcraft, a JV company of Tata Sons and Agusta Westland, has proposed
to set up an assembly line for helicopters in Hyderbad on a 10-acre site. The JV willcommence production from June 2013 and will initially produce the eight-seater
AW119Ke light helicopter.
The facility will be capable of producing up to 30 helicopters per annum.
NA
Tata Power
Strategic
Electronics
Division (SED)
New Zealand-based Radiola Aerospace Limited has won a four-year contract
to undertake ight inspections of new navigation aids at 30 military airelds
throughout India.
The contract is awarded by TATA Power SED. Tata Power SED holds a prime contract
with the Indian MoD to modernize the facilities at airelds operated by the Indian Air
Force.
NA
*The values of the deals have been converted to Indian Rupees using Oanda currency conversion tool
1US$ = INR51.8521 (Values as on 31 March 2012)
Eye on defence | 20
-
7/25/2019 Eye on Defense_April 2012
21/31
Joint ventures and alliances
Name of entities Nature of transaction Value
DCNS and SEC
Indus-tries
DCNS, a French naval defence company signed a contract (through DCNS India) with
Hyderabad-based SEC Industries for the local manufacturing of equipment for the
P75 Scorpene submarines.
SEC will manufacture equipment under a TOT provided by DCNS India and they will
be delivered to its customer, Mazagon Dock Limited (MDL).
INR3.1 bil-lion
Larsen & Toubro
and Thalest Ltd.
The electrical and automation business division of L&T acquired Thalest, UK-based
provider of ship control and automation systems.
The acquisition is aimed at expanding the automation offerings for ships.
INR240 million
Industria
de Turbo
Propulsores
and Reginson
Engineering Ltd.
and Raghu Vamsi
Spanish manufacturer of turbines for aircraft engines, Industria de Turbo
Propulsores (ITP), in alliance with British rm Reginson Engineering Ltd. and Indian
rm Raghu Vamsi have set up a plant in India with an objective of ex-pansion and
diversication.
The agreement was signed by ITPs subsidiary Tuberias Aeronauticas with the local
rms.
The production output is planned to double in 2014 whereas the number of
employees will be more than 100 people.
INR165.98 million
Reliance
Industries Ltd.
and Dassault
Reliance Industries Ltd. (RIL) and French Dassault Aviation SA have signed a
preliminary agreement to explore defence projects in alliance.
The two companies are yet to identify areas where they can collectively work.
NA
TTI, Inc. and
Radiant Corp
TTI entered an agreement with Radiant Corporation to supply interconnects,
electromechanical, and passive (IP&E) components.
Radiant manufactures its own requirements of composite cables and recently
entered the eld of aviation grade cable looms and wiring harnesses to participate in
the growing offset business generated as a result of aircraft supply contracts to the
Indian Armed Forces.
NA
Mahindra andMahindra and
Rafael
Mahindra & Mahindra announced its JV with Rafael that will focus on developmentand manufacturing of products such as Torpedo Defence Systems, Electronic
Warfare Systems, Advanced Armour Solutions and Remotely Operated Weapon
Stations for Futuristic Infantry Combat Vehicles (FICV).
A manufacturing facility is expected to be set up in Pune. Mahindra will own a 74%
stake in the JV with Rafael and is expecting a turnover of US$500 million in the next
10 years.
NA
Larsen & Tubro
and Nexter
Larsen & Tubro signed an agreement with French defence products company Nexter
to jointly bid for the Indian armys artillery gun programs.
Nexter is expected to transfer technology for its towed and mounted gun systems to
L&T. The Indian company plans to assemble Nexters Caesar and Trajan guns in India.
NA
Eye on defence | 21
-
7/25/2019 Eye on Defense_April 2012
22/31
Name of entities Nature of transaction Value
Larsen & Toubro
and Samsung
Techwin Co.
Larsen & Toubro Ltd. entered an agreement with South Korean defence products
company Samsung Techwin Co. to make howitzer guns in India.
The companies have already submitted a bid to supply up to 100 guns to the Indian
army.
NA
Selex Galileo andData Patterns
Pvt. Ltd.
Selex Galileo and Data Patterns (India) Pvt. Ltd. will seek approval from the GoI toform a JV to make defence electronics products. The two companies will establish a
new facility at Chennai.
Selex Galileo will hold a 26% stake in the planned joint ven-ture (JV) and plans to
employ 100 people initially.
NA
ITT Exelis and
Tata Advanced
Systems (TASL)
ITT Exelis and Tata Advanced Systems Limited have formed a strategic alliance to
support Generation (Gen) 3 night vision requirements in India.
ITT Exelis will provide TASL with the technology to build night vision devices in
India, which will be followed by manufacture of high precision components and sub-
assemblies of the devices by TASL.
NA
DHS Systems
and BharatElectronics
DHS Systems International, manufacturer of shelters entered Indian market,
through a long term deal with Bharat Electronics Limiteds Navi Mumbai unit.
DHS Systems International aims to generate revenue of INR1billion in the next
three years from the defence and health care sectors in India and also set up a
manufactur-ing facility by 2015.
NA
DCNS and IIT
Bombay
Naval Defence Company, DCNS entered an agreement with IIT Bombay for
education and research programs in naval defence and energy.
According to the MoU, R&D programs will be carried out jointly by IIT Bombay and
DCNS Research teams while training of DCNS personnel will be conducted by IIT
Bombay.
NA
Eye on defence | 22
-
7/25/2019 Eye on Defense_April 2012
23/31
Country-level deals and initiatives
Country Nature of transaction Additional details
US For the rst time in Indo-US war games, the Americans
will deploy their tanks in the company-level Exercise
Yudhabhyas scheduled to be held in the Mahajan eld
ring ranges in the Rajasthan desert in March.
Apart from elding three tanks, the US will also deploy
around 200 men accompanied by armored personnel
carriers for the war games.
India will le its Russian-origin BMPs along with tanks for
the war game.
Russia The MoD plans to purchase six Mi-17 V-5 heli-copters
from Russia to be used by the Union Home Ministry.
Through the purchase, the Ministry will assist its forces
engaged in internal security duties. These helicopters
are being built by Russian Helicopters Kazan Helicopter
Factory (KVZ) subsidiary.
Currently, the defence ministry is negotiating purchase of
59 Mi-17 s after its rst order of 80 such helicopters to
the Russian company.
Brazil
(Defence talks)
The talks between the Defence ministers of India and
Brazil were held in India in February 2012.
Topics of discussion revolved around cooperation in the
naval sector to build aircraft carriers and submarines ofthe Scorpene class, expansion of the existing vacancies
for exchange of military ofcers, and courses of higher
education offered by the military schools of both
countries.
Other key areas on the agenda included talks on
partnerships between Brazilian and Indian armies to
establish research centers for development of defence
equipment that meet the future needs such as the
Border Monitoring System (Sisfron), talks related to theirrespective air forces, exchanges between schools of
pilots, aerospace medicine, search and rescue operations
and parachuting.
A u st ra l ia T he S oc i et y o f I nd i an A e ro sp a ce a n d Te ch n ol - og i es
(SIATI) and Aviation Aerospace Australia (AAA) have
forayed into a long-term pact to jointly develop the
aerospace industry in both the countries.
The agreement has signaled a new level of cooperation
and the collaboration is likely to help both the
organizations to share knowledge, develop domain
expertise and transfer skills.
S i ng a po re A i r C h ie f M a rs h al N A K B ro wn e, C h ie f o f t h e A i r S ta ff,
went on a four day Defence Cooperation visit to
Singapore.
The discussion issues revolved around the ongoing
defence cooperation between the two countries toward
expanding the already robust bilateral military-to-military
ties and also a visit the Singapore Air Show.S r i L a nk a I na u gu ra l d ef en ce d i al o g h as t a ke n p l ac e b e -t we e n t h e
Defence Secretaries of India and Sri Lanka.
Regional security situation including issues of maritime
security in the Indian Ocean region were the key themes
at the inaugural annual defence dialog.
J ap an J ap an es e d el eg at io n l ed b y A dm ira l H is ay as u S uz uk i,
the Commandant, Japan Coast Guard (JCG), for the XI
High Level Meeting and Combined Exercises met with the
Indian Coast Guard (ICG).
The ve-day visit, was in pursuance of the Memorandum
of Cooperation (MoC), signed between the two Coast
Guards on 24 November 2006, which stipulates that the
heads of the two organizations meet alternately in India
and Japan, to discuss maritime issues of mutual concerns
and formulate a cooperative approach to address these.
S audi Arabia The Indian and S audi armed forces are likely to conduct
joint exercises involving S audi and Indian ship visits from
both sides and to work closely to combat sea piracy.
The joint committee will also prepare a draft agreement
that will be endorsed by both sides in the eld of
hydography. The two sides intend to discuss the details of
their future defence cooperation, including the details of
an agreement in the defence sector.
Eye on defence | 23
-
7/25/2019 Eye on Defense_April 2012
24/31
Industry buzz
Stronger role of private sector
in Defence
The private sectors role in the Defence
sector is likely to get strengthened, under
the Armed Forces Long-term Integrated
Perspective Plan soon to be made public by
the Union Government. Under the 15-year
plan, the private sector will have a greater
role in meeting the requirements of the
armed forces, in terms of investment and
in research and development of technology
such as electronic warfare.
(Source: Greater role for private parties in
Defence sector, The Hindu, 23 February
2012, via Factiva, 2012 Kasturi & Sons
Ltd.)
Electronic warfare proposition
attractive for India
India could soon get access to electronic
warfare (EW), the science of electronically
dodging and attacking the enemy, with an
INR250 billion business proposition awaiting
the countrys public and private sectors.
The countrys military labs were equipping
the three forces with futuristic EW or
intelligent devices, including radar warners,
missile warners, electronic and leak-proof
communication intelligence, jammers and
detectors. These will be tted on ground
vehicles, ships and also on unmanned
combat air vehicles, ghter planes and even
future satellites to enhance the militarys
seeing and hearing ranges. Currently,
Bharat Electronics Ltd, (BEL) is a major
provider of EW hardware and solutions to
the military.
(Source: Electronic warfare offers Rs
25,000-cr biz for India Inc., Business Line
(The Hindu), 22 February 2012, via Factiva,
2012 The Hindu Business Line.)
Government extends support on
Defence PSU JVs
The ofcial guidelines on formation of a JV
by Defence PSUs are an attempt toward a
fair and transparent framework to enable
such tie-ups. A case in point is the recent
controversy around the JV by Mazagon
Dock Ltd., a shipbuilder under the Ministry
of Defence, with the privately promoted
Pipavav Shipyard for constructing warships
for the Navy. The GoI is responding to these
concerns, with the guidelines containing
provisions on selection of JV partners by the
Defence PSUs.
(Source: In defence of joint ventures,
Business Line (The Hindu), 13 February
2012, via Factiva, 2012 The Hindu Business
Line.)
Indian records success in missile
test re
India has achieved another defence
milestone by successfully ight-testing one
of its sophisticated in-terceptor missiles
from Wheeler Island in Orissas Bhadrak
district. The interceptor named Advanced
Air Defence (AAD), destroyed a target
missile. The test was part of a coordinated
air defence exercise, which featured twomissiles an interceptor and a target
missile.
(Source: Advanced interceptor missile test-
red successfully, The Times of India, 12
February 2012, via Factiva, 2012 The Times
of India Group.)
Eye on defence | 24
-
7/25/2019 Eye on Defense_April 2012
25/31
Ministry of Defence debars rms
The Ministry of Defence has debarred six
rms M/s Singapore Technologies Kinetics
Ltd. (STK), M/s Israel Military Industries Ltd.,
M/s Rheinmetall Air Defence, Zurich, M/s
Corporation Defence, Russia, M/s TS Kisan &
Co. Pvt. Ltd., New Delhi and M/s RK Machine
Tools Ltd., Ludhiana from further business
dealings with the Ordnance Factory Board,
Department of Defence Production, MoD,
for a period of ten years. The rms have
been blacklisted by the CBI on the evidence
collected against them.
(Source: MoD Debars Six Firms from
Business Dealings for Ten Years, Press
Information Bureau website, http://pib.nic.
in/newsite/AdvSearch.aspx, accessed 15
March 2012.)
Indian IT majors work hard to
lure MNC defence players
Indian IT companies are working hard
to forge partnerships with aerospace
majors, as the countrys defence budget is
expected to reach US$50 billion in the next
three years. Software rms are exploring
opportunities arising from offset obligations
of multinational defence companies as IT
adoption related to communication, human
and machine management in Armed Forces
is on the rise. According to the offset policy,
foreign defence manufacturers have to
buy from local players or form JVs to pass
back 30% of the cost of the contract. A casein example is the Wipros tie-up with an
European organization for manufacturing
and global supply of actuators for landing
gears.
(Source: Software cos aggressive on
defence offset policy, Financial Express, 14
February 2012, via Factiva, 2012 Indian
Express Online Media Pvt. Ltd.)
Hatsoff simulator receives LevelD certication
A JV of HAL and CAE, Helicopter Academy
to Train by Simulation of Flying (Hatsoff)
recently announced that one of its simulator
cockpits has received a certication of
Level D. Level D is the highest qualication
for ight simulators and Hatsoff has got
the certication for Eurocopter AS365
N3 Dauphin helicopter. Indias Directorate
General of Civil Aviation and the European
Aviation Safety Agency (EASA) have given
the certication. Further, its three simulator
cockpits-a Bell 412, a HAL civil/conventional
Dhruv, and the Eurocopter AS365 N3
Dauphin-have been certied as Level 2
(JAR)/Level 6 (FAA) ight-training devices
when used as xed-base, non-motion
simulators in the docking station installed at
the facility.
(Source: Simulator gets regulators nod,
DNA - Daily News & Analysis, 13 January
2012, via Factiva, 2012 Diligent Media
Corporation Ltd.)
First batch of Mi-17V-5
helicopters made operational in
India
The rst batch of Mi-17V-5s, delivered as
per the contract signed in 2008, has been
made operational by the Indian Air Forces.
A contract on 80 Mi-17V-5s had been
signed in 2008. Around 20 helicoptershave already been delivered to India. These
vehicles are being produced by Kazan
helicopter plant. All 80 helicopters are
expected to be operational by 2014.
(Source: India puts rst Mi-17V-5
helicopters into operation, SKRIN
Newswire, 20 February 2012, via Factiva,
2012 SKRIN.)
Delivery of six Scorpenesubmarines delayed
The delivery of six Scorpene submarines,
being constructed at the Mazagon Dock
Limited (MDL), Mumbai, under Project-75
has been delayed. The delivery schedule
of the rst submarine has been revised to
June 2015 and that of the last submarine
to September 2018. The original delivery
schedule for the rst submarine was
December 2012 and the remaining were to
be delivered with a gap of one year each.
The delay in schedule is because of problems
in absorption of new technology, delay in
augmentation of industrial infrastructure
at MDL and delay in procurement of items
due to high cost as compared to the earlier
indicated cost.
(Source: Delivery of Scorpene submarines
delayed: Govt, 19 March 2012, Press Trust
of India Limited, via Factiva, (c) 2012 Asia
Pulse Pty Limited.)
Cochin Shipyard provides
platform supply vessels to SCI
Indian shipbuilder, Cochin Shipyard Ltd.,
has launched two platform supply vessels
for water transport company Shipping
Corporation of India (SCI). The ships, BY-85,
SCI Nalanda, and BY-86, SCI Yamuna, are
platform supply vessels of the UT 755 CD
type, designed by Rolls-Royce Marine AS,
Norway, a subsidiary of UK engineeringgroup Rolls-Royce Group plc.
(Source: Cochin Shipyard launches platform
supply ships for SCI, SeeNews Shipping,
9 January 2012, via Factiva, 2012
SeeNews.)
Eye on defence | 25
-
7/25/2019 Eye on Defense_April 2012
26/31
Police department will getaccess to Electronic warfare
technologies
India is set to develop electronic warfare
technologies to help paramilitary and police
ght the Maoists and terrorists. Defence
Research and Development Organisations
(DRDO) Chief Controller Research and
Development (Avionics) G. Elangovan said
that the agency has created a separate chief
controller (R&D) for low intensity conict
to identify electronic warfare technologiesthat can be customized to help paramilitary
and police meet internal security needs. The
DRDO intends to involve the private sector
in co-developing niche products required
for low-intensity conict with anti-national
elements within the country.
(Source: Electronic warfare technologies
to be developed for police, Indo-Asian News
Service, 22 February 2012, via Factiva,
2012 Indo-Asian News Service.)
IBMs security intelligence
platform to ght cyber attacks
IBMs QRadar Security Intelligence Platform
allows analysis of real-time data feeds
from more than 400 different sources. The
company mentioned that this platform helps
in identifying threats and hackers with real-
time analysis of the trafc on the corporate
IT infrastructure.
(Source: IBMs QRadar Security to ght
against cyber attacks!, EFYtimes.com, 23
February 2012, via Factiva, 2012 EFY
Enterprises Pvt. Ltd.)
Mahindra Aerospace likely toset up plant abroad
Mahindra Aerospace, the aerospace
division of Mahindra & Mahindra Group is
considering setting up plants for 8- to18-
seater aircraft in the US, Canada, Latin
America and China. This is being done to
establish its presence among these markets.
Mahindra has plans to increase its business
ve-fold by selling approximately 100
aircraft annually by 2015. The company
is also looking for a potential technology
partner as well as a hanger to build its own
aircraft in India by 201314. It also aims
to become a Tier I component supplier to
aircraft makers Airbus and Boeing as part
of the governments US$10-billion offset
program.
(Source: Ketan Thakkar, Mahindra Aero
Plans Aircraft Assembly Abroad, 23 March
2012, via Factiva, The Economic Times
Bangalore Edition, 2012. Bennett,
Coleman & Co., Ltd.)
Tatas may make choppers if
Sikorsky bags defence deal
Sikorsky Aircraft Co, a US-based aircraft
manufacturer is among the two companies
shortlisted by the Ministry of Defence (MoD)
to supply 16 multi-role helicopters to the
Indian Navy in a US$1 billion deal. It is
currently awaiting a license from the GoI
to manufacture components and assemble
helicopters for the Indian defence services.
Tata Sikorsky Aerostructures, joint-venture
with Tata Advanced Systems Ltd, is likely to
benet if Sikorsky bags the defence deal.
(Source: K V Ramana,Tatas may make
choppers if Sikorsky bags defence deal,4
April 2012, DNA Money, via Factiva, 2012.
Diligent Media Corporation Ltd.)
Indian rms to provide food andclothing for space mission
Two life science laboratories of the Defence
Research Development Organisation (DRDO)
will provide food and clothing for the
Indian astronauts ( Vyomanauts), during
the countrys rst human space mission.
The Mysore-based Defence Food Research
Laboratory (DFRL) will provide ready-to-eat
food in space, the Defence Bioengineering
and Electromedical Laboratory (Debel) (both
under DRDO) will design and produce the
space suits for the rst vyomanauts of India.
Bengaluru-based Debel, which has already
developed Nuclear Biological and Chemical
(NBC) protection suits, ight clothing and
protective equipment for air crew, has been
assigned to develop the highly complex
space suits. It is the rst time that space
suits will be developed in India.
(Source: Debel to develop suits for
astronauts, DNA - Daily News & Analysis,
13 February 2012, via Factiva, 2012
Diligent Media Corporation Ltd.)
DRDO launches explosive
detection kits
DRDO launched the Explosive Detection
Kit (EDK) at the Defence Expo 2012.
It was chosen among more than 70
products and technologies developed for
defence applications with potential civilian
applications that have been identied for
commercialization under the DRDO-FICCI
ATAC (Accelerated Technology Assessment
Commercialization) programme. The
Explosive Detection Kit (EDK), developed by
Pune based High Energy Materials Research
Laboratory, can quickly detect and identify
even traces of explosives.
(Source: DRDO to Launch Explosive
Detection and Swine Flu Diagnostic
Kits at DEFEXPO, Press In-formation
Bureau website, http://pib.nic.in/newsite/
AdvSearch.aspx, accessed 17 April 2012.)
Eye on defence | 26
-
7/25/2019 Eye on Defense_April 2012
27/31
Ashok Leyland launches COLTrange of defence vehicles
Ashok Leyland Defence Systems engaged in
the manufacture of specialized tactical and
armored vehicles unveiled the rst of the
range of COLT tactical vehicles - the Light
Tactical Vehicle (4x4) at the Defence Expo
2012. The Light Tactical Vehicle is being
developed its strategic partnership with
French-based, Panhard General Defense,
France.
(Source: Ashok Leyland Defence Systemsunveils the COLT range of tactical vehicle,
30 March 2012, ENP NewsWire, 2012,
Electronic News Publishing.)
Tata Motors showcases anti-terrorist combat vehicle
and launches Prahar missile
launcher and armored vehicles
at Defence Expo India 2012
Tata Motors showcased a new Micro Bullet-
Proof Vehicle (MBPV) at DEFEXPO India
2012, a mobile combat vehicle for indoor
combat inside airports, railway stations
and other such infrastructure. Tata Motors
launched four other defence vehicles the
Tata 12x12 Prahaar Missile Carrier, the Tata
Light Armoured Vehicle, the Tata Mobile
Bunker and the Tata 6x6 7kl Refueler during
the event.
(Source: Tata Motors showcases Anti-
Terrorist Indoor Combat Vehicle concept
at DEFEXPO India 2012; Launches Prahar
missile launcher and armoured vehicles, 30
March 2012, ENP Newswire, via Factiva, (c)
2012, Electronic News Publishing.)
Eye on defence | 27
-
7/25/2019 Eye on Defense_April 2012
28/31
Sources
1. Aircraft component manufacturing unit in Bangalore; Internationa l Aerospace
Manufacturing is implementing an aircraft component manufacturing project in dist.
Bangalore, Karnataka, Domex New Engineering & Metallurgical Projects, 25 January 2012,
via Dow Jones Factiva, 2012 Domex Business Information Pvt Ltd.
2. Indian Navy inducts INS Chakra, Domain-B, 24 January 2012, via Factiva, 2012 The
Information Company Pvt. Ltd.
3. Indian govt planning two Ipos to raise funds,Asia Pulse, 24 January 2012, via Factiva, 2012 Asia Pulse Pty Limited.
4. Expansion: ITP opens rst parts plant in Asia, Expansin, 24 January 2012, via Factiva,
2012 AII Data Processing Ltd.
5. HHV to expand with a third plant around Bangalore, Industry 2.0, 23 January 2012, via
Factiva, 2012 Nine Dot Nine Mediaworx Pvt. Ltd.
6. Obzerv Technologi es gets Bharat Electronics contract, Entertainment Close-Up, 23
January 2012, via Factiva, 2012 Close-Up Media, Inc.
7. Rs 10,030 crore plan to link India with choppers, The Economic Times, 23 January 2012,
via Factiva, 2012 The Times of India Group.
8. Plan panel to allocate Rs 5k crore to develop civilian plane, The Press Trust of India
Limited, 22 January 2012, via Dow Jones Factiva, 2012 Asia Pulse Pty Limited.
9. CCS to discuss Rs1850 crore proposal for 75 trainer aircraft, The Press Trust of India
Limited, 15 January 2012, via Factiva, 2012 Asia Pulse Pty Limited.
10. MHA to buy 6 Mi-17 copters from Russia,The Times of India, 4 February 2012, via
Factiva, 2012 Bennett, Coleman & Co., Ltd.
11. Brazilian def min arrives here on Feb 4 on 5-day visit, United News of India, 2 February
2012, via Factiva, 2012 United News Of India.
12. BrahMos missile to be integrated at BATL in two years, The Hindu, 2 February 2012, via
Factiva, 2012 Kasturi & Sons Ltd.
13. Bumar sells $300m vehicles to India, Polish News Bulletin, 21 January 2012, via Factiva,
PNB Company Ltd. 2012.
14. RIL, Dassault in talks for defence venture, Indian Express, 14 February 2012, via Factiva,
2012 Indian Express Online Media Pvt. Ltd.15. HAL prepares to manufacture Rafale combat jet in India, Indo-Asian News Service, 13
February 2012, via Factiva, 2012 Indo-Asian News Service.
16. IAF Chief Leads Delegation to Singapore, Press Information Bureau website, http://pib.
nic.in/newsite/AdvSearch.aspx, accessed 15 March 2012.
17. India, Sri Lanka hold Inaugural Defence Dialogue, Press Information Bureau website,
http://pib.nic.in/newsite/AdvSearch.aspx, accessed 15 March 2012.
18. India, Japan Coast Guard Meeting and Combined Exercises Conclude, Press Information
Bureau website, http://pib.nic.in/newsite/AdvSearch.aspx, accessed 15 March 2012.
19. Opto to partner German rm to supply AEDs to aircraft makers,The Press Trust of India
Limited, 2 February 2012, 2012 Asia Pulse Pty Limited.
20. Antony to inaugurate HAL unit in February, The Hindu, 19 January 2012, via Factiva,2012 Kasturi & Sons Ltd.
Eye on defence | 28
-
7/25/2019 Eye on Defense_April 2012
29/31
21. Russia will start supplying mig-29 to India under the contract of 2010 in 2012, WPS:
Defense & Security, 13 January 2012, via Factiva, 2012 WPS Russian Media Monitoring
Agency.
22. Joint team to prepare road map for Saudi-India defense cooperation,Arab News, 15
February 2012, via Factiva, 2012 Arab News.
23. M&M inks two defence JVs,Hindustan Times, 31 March 2012, , via Factiva, HT Media
Limited.24. Hyderabad to host missile productio n unit, Bureaucracy Today, 20 March 2012, via
Factiva.
25. Rs 7,000 cr to be invested to set up 9 defence units, Business Line (The Hindu), 19 March
2012, via Factiva, 2012 The Hindu Business Line.
26. TTI Announces Supply Agreement with Radiant Corporation India,15 March 2012, ENP
Newswire, via Factiva, 2012 Electronic News Publishing)
27. M&M inks 2 defence JVs, 31 March 2012, Hindustan Times, via Factiva, 2012. HT
Media Limited.
28. DCNS, Bombay IIT ink MoU for programs in naval defence, energy, 31 Marc h 2012, The
Press Trust of India Limited, via Factiva, 2012 Asia Pulse Pty Limited.
29. Larsen, Nexter Sign Pact To Bid For Indian Armys Artillery Gun Programs, 30 March
2012, Dow Jones Business News, via Factiva.
30. Santanu Choudhury, Finmeccanica Unit Selex Galileo, Indias Data Patterns Plan Defense
Electronics JV, 30 March 2012, Dow Jones International News, via Factiva, (c) 2012 Dow
Jones & Company, Inc.
31. Kalyani Group Executive: To Invest INR1 Bln To Develop Towed Artillery Gun, 29 March
2012, Dow Jones International News, via Factiva.
32. Nikhil Gulati, Tata Motors May Invest $59 Million in New Factory, 29 March 2012, The Wall
Street Journal Online, 2012 Dow Jones & Company.
33. DHS Systems signs MOU with Bharat Electronics, India Infoline News Service, 29 March
2012, via Factiva.
34. BEML Puts up Aerospace Manufacturing Complex at SEZ, Bangalore, 4 April 2012, Press
Trust of India, via Factiva.35. Indian Rotorcraft to set up copter facility at Hyderabad, Project Monitor, 28 March 2012,
via Factiva, 2012 Economic Research India Pvt. Ltd.
36. Electronics Companies; Smiths Detection Wins $20M Indian Customs Contract, Journal of
India, 27 March 2012, via Factiva, 2012 Journal of India via VerticalNews.com.
37. Upgradation of Mirage aircraft, Indian Government News, 26 March 2012, via Factiva,
2012. HT Media Limited.
38. DCNS signs with SEC Industries a contract for the local manufacture of equipment for
the Indian Scorpene submarines, ENP Newswire, 26 March 2012, via Factiva, 2012,
Electronic News Pub-lishing.
39. Mahindra Aero Plans Aircraft Assembly Abroad, The Economic Times - Bangalore Edition,
23 March 2012, via Factiva, 2012, Bennett, Coleman & Co., Ltd.
40. Radiola Aerospace lands plumb Indian contract, Fuseworks Media, 21 March 2012, via
Factiva, 2012 Fuseworks Limited.
41. Y. Mallikarjun, Pratt & Whitney plans to invest $150 m, 20 March 2012
Eye on defence | 29
-
7/25/2019 Eye on Defense_April 2012
30/31
For more information, visit www.ey.com/India
Connect with us
Assurance, Tax, Transactions, Advisory
A comprehensive range of high-quality services tohelp you navigate your next phase of growth
Read more on www.ey.com/India/Services
Our services
Centers of excellence for key sectors
Our sector practices ensure our work with you istuned in to the realities of your industry
Read about our sector knowledge at ey.com/India/industries
Sector focus
Easy access to ourknowledge publications.Any time.
http://webcast.ey.com/thoughtcenter/
Webcasts and podcasts
www.ey.com/subscription-form
Follow us @EY_India Join the Business networkfrom Ernst & Young
Stay connected
-
7/25/2019 Eye on Defense_April 2012
31/31
Ahmedabad
2nd oor, Shivalik IshaanNear. C.N VidhyalayaAmbawadi,Ahmedabad 380 015Tel: + 91 79 6608 3800
Fax: + 91 79 6608 3900
Bengaluru
12th & 13th oorU B City Canberra BlockNo.24, Vittal Mallya RoadBengaluru 560 001Tel: + 91 80 4027 5000 + 91 80 6727 5000Fax: + 91 80 2210 6000 (12th oor)Fax: + 91 80 2224 0695 (13th oor)
Chandigarh
1st FloorSCO: 166-167
Sector 9-C, Madhya MargChandigarh 160 009Tel: + 91 172 671 7800Fax: + 91 172 671 7888
Chennai
Tidel Park,6th & 7th FloorA Block (Module 601,701-702)No.4, Rajiv Gandhi SalaiTaramaniChennai 600 113Tel: + 91 44 6654 8100Fax: + 91 44 2254 0120
HyderabadOval Ofce18, iLabs Centre,Hitech City, Madhapur,Hyderabad 500 081Tel: + 91 40 6736 2000Fax: + 91 40 6736 2200
Kochi
9th Floor ABAD NucleusNH-49, Maradu PO,Kochi 682 304Tel: + 91 484 304 4000Fax: + 91 484 270 5393
Kolkata22, Camac Street3rd Floor, Block CKolkata 700 016Tel: + 91 33 6615 3400Fax: + 91 33 2281 7750
Mumbai6th Floor Express TowersNariman PointMumbai 400 021Tel: + 91 22 6192 0000Fax: + 91 22 6192 2000
14th Floor, The Ruby29 Senapati Bapat MargDadar (west)Mumbai 400 028Tel + 91 22 6192 0000Fax + 91 22 6192 1000
5th Floor Block B-2,Nirlon Knowledge ParkOff. Western Express HighwayGoregaon (E)Mumbai 400 063Tel: + 91 22 6192 0000Fax: + 91 22 6192 3000
NCR
Golf View CorporateTower BNear DLF Golf Course,Sector 42Gurgaon 122 002Tel: + 91 124 464 4000Fax: + 91 124 464 4050
6th oor, HT House18-20 Kasturba Gandhi MargNew Delhi 110 001Tel: + 91 11 4363 3000Fax: + 91 11 4363 3200
4th & 5th Floor, Plot No 2B,Tower 2, Sector 126,Noida 201 304Gautam Budh Nagar, U.P. IndiaTel: + 91 120 671 7000Fax: + 91 120 671 7171
Pune
C401, 4th oorPanchshil Tech ParkYerwada (Near Don Bosco School)Pune 411 006Tel: + 91 20 6603 6000Fax: + 91 20 6601 5900
Ernst & Young Pvt. Ltd.
Assurance | Tax | Transactions | Advisory
About Ernst & Young
Ernst & Young is a global leader in assurance, tax,
transaction and advisory services. Worldwide, our
152,000 people are united by our shared valuesand an unwavering commitment to quality. We make
a difference by helping our people, our clients and
our wider communities achieve their potential.
Ernst & Young refers to the global organization of
member firms of Ernst & Young Global Limited,
each of which is a separate legal entity. Ernst &
Young Global Limited, a UK company limited by
guarantee, does not provide services to clients. For
more information about our organization, please
visit www.ey.com.
Ernst & Young Pvt. Ltd. is one of the Indian client serving member
firms of EYGM Limited. For more information about our organization,
please visit www.ey.com/in
Ernst & Young Pvt. Ltd. is a company registered under the Companies
Act, 1956 having its registered office at 22 Camac Street, 3rd Floor,
Block C, Kolkata - 700016
2012 Ernst & Young Pvt. Ltd. Published in India.
All Rights Reserved.
This publication contains information in summary form and is
therefore intended for general guidance only. It is not intended to
be a substitute for detailed research or the exercise of professional
j udgment. Nei ther EYG M L i mited nor any other member of the gl obal
Ernst & Young organization can accept any responsibility for loss
occasioned to any person acting or refraining from action as a result
of any material in this publication. On any specific matter, reference
should be made to the appropriate advisor.
EYIN1205-043
Ofces
For more information , please contact:
K. Ganesh Raj
Partner and Leader
Aerospace and Defence Practice
Ernst & Young Pvt. Ltd.
Tel: + 91 120 671 7110
Email: [email protected]
Ankur Gupta
Senior Consultant
Aerospace & Defence, IIC- PI
Ernst & Young Pvt Ltd